Psst! Wanna buy a municipal bond?
You look like a smart person who wants to earn a little money in these tough times. Wanna buy a municipal bond?
Triple tax free. Guaranteed income. New York, California--trust me, they're not gonna go out of business.
'This year you should worry about bonds," wrote John Crudele in the January 6th New York Post. "You say you don't own any. Well, that doesn't really matter because if the bond market is in a bubble - like I think it is - and it bursts, then the whole economy is going to suffer even greater pain."
Today's New York Times story is titled: "Nationwide Inquiry on Bids for Municipal Bonds." The story touches on New Mexico Governor Bill Richardson's problems, but then casts a nationwide net.
"Three federal agencies and a loose consortium of state attorneys general have for several years been gathering evidence of what appears to be collusion among the banks and other companies that have helped state and local governments take approximately $400 billion worth of municipal notes and bonds to market each year."
New York is up to its eyeballs in problems such as this. The recently departed New York state/city comptroller Alan Hevesi had a very cozy relationship with certain firms. No one cared; his downfall was hiring a driver for his wife!
"Christopher Cox, the chairman of the Securities and Exchange Commission, has said oversight of the municipal bond markets is inadequate, and has urged Congress to take steps to protect both investors and taxpayers. Congress has not taken up the initiative. "
There's a little song that I now sing. "Wake up, little S.E.C., wake up! The markets aren't so hot, there isn't much of a pot, Bernie Madoff's in the pokey now, his reputation's shot. Wake up, little S.E.C.!"
If the S.E.C. chairman says that municipal bond oversight is inadequate, you pretty much know that it doesn't even exist.
"The S.E.C. polices fraud in the municipal bond markets and is looking into whether municipal bonds are routinely certified for tax-exempt treatment, by people who perhaps know or should know they do not qualify."
Hello, New York Yankees! Remember when the Yankees cleaned the streets and built all those bridge and tunnels? No, wait, the Yankees don't do that. They play baseball. They're a private company that plays a sport to make a profit. Silly me. So why did the Yankees get billions of dollars in tax-free bonds? Remember how the Yankees asked for even more?
You want to buy a bond? Buy a Triple A bond. They're the best. You can trust the ratings system because--actually, you can't trust the ratings system. It's the same system that rated Lehman Brothers A+ when it was worthless, defrauding people like me. It's the same system that rates MTA and Port Authority crap in an "A" class, well above the junk they are. "Wake up, little S.E.C., wake up!"
"The Justice Department’s criminal antitrust division has authority over bid-rigging, and that part of the investigation is being led by federal prosecutors in Manhattan. At the same time, various regional U.S. attorneys’ offices around the country are looking at whether campaign contributions and other gifts to state and local politicians were used improperly to “buy” bond-related business."
If this house of cards falls, almost every city and state will feel it. Carolyn Maloney, please read this article! If you want to be a senator (or merely a good Congresswoman), make your mark! You'll make lots of enemies in New York, but make these enemies early! They're going to be exposed and they're all going down, anyway!
Psst! You look like a person who wants to save money on taxes. Wanna buy a municipal bond?
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